Tuesday, October 11, 2016

Washington is broken - The election is over and Hillary has won - Trump was 'assassinated' by the press - Straight into political warfare after election - Immediate impeachment proceedings against Clinton after victory?

The alarm over U.S. public pension shortfalls grows louder, which brings to mind this prescient comment from Robert Prechter's 2002 book, Conquer the Crash:

If you have a pension, you are almost surely dependent upon [securitized loans]. ... In a major economic downturn, this credit structure will implode.

And that's exactly what happened during the 2007-2009 "mortgage-meltdown." Large banks had taken out home loans made by retail banks and mortgage brokers and resold them to others. As we know, too many of those loans were bad, and the result was the worst financial crisis since the Great Depression.

Many public pension funds have yet to recover, even after a prolonged stock market uptrend.

May 4 -- James Rickards, author of The New Case for Gold, explains the relationship between gold and the U.S. dollar and how he sees global currencies measuring up against the dollar. He speaks on "Bloomberg Markets."

Learn how protective stops keep you on the right side the trendBy Elliott Wave International

On a recent vacation to the Yucatan, my friend decided to get certified in scuba diving.

I, on the other hand, prefer breathing my air above water! But I did tag along with her to one of the classes, anyway. She learned how to handle and interpret all the various diver gauges: gas pressure, submersive pressure, depth, and on.

The one feature all those indicators had in common was a bold, red line to indicate the level the diver must obey to stay out of danger.

That's when it hit me: Scuba-diving is a lot like financial markets. Investors and traders jump in -- and use an array of safety gauges to keep them on the right side of price action.

Well, at least those investors and traders who use technical market indicators. For them, those bold, red lines indicating the point of danger -- those are equivalent to the most critical component of market analysis: protective stops. The second prices cross this line, it's time to "swim back up to the surface" and safely re-adjust your position.

Thursday, April 28, 2016

The era of "always low prices" no longer translates into always high profits. Learn what we think is behind the shiftBy Elliott Wave International

Walmart founder Sam Walton said:

"There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else."

Never were those words felt more acutely for those on the Walmart payroll than right now. Reason being: Over the last year, the eponymous Walmart "customer" has, indeed, taken his business elsewhere, fueling a series of epic setbacks for the retail giant:

Store closures, layoffs, and the shuttering of its entire fleet of smaller "Express" locations across the U.S.

A near 40% decline in its stock (WMT) before hitting bottom in November 2015

Losing its status as the world's #1 retailer to Amazon

And -- the sour cherry on top: The first decline in annual revenue since Walmart went public 45 years ago

In the words of a March 31 Bloomberg: It's "the end of an era for Walmart."

Which leaves one question: How the heck does a big-box behemoth go from retail victor to re-fail victim?

Well, according to the mainstream experts, the main cause of Walmart's woes are many-fold, from falling oil prices - to - China's flailing economy - to - the extinction of the brick-and-mortar store - to - the biggest baddest culprit of all, the brawny greenback:

Sunday, January 31, 2016

Greg Hunter Interviews David Stockman:

I think the world economy is plunging into an unprecedented deflation recession period of shrinkage that will bring down all the markets around the world that have been vastly overvalued as a result of this massive money printing and liquidity flow into Wall Street and other financial markets.

By Elliott Wave International

"The Standard & Poor's 500 finished the year down 0.73%... The DJIA suffered its worst year since the 2008 financial crisis, declining 2.2%... Only the Nasdaq ended the year up... 5.7%...

"...energy stocks as a group plunged 24%, and individually, many fell 30 or 40%. The energy plunge hurt unsuspecting retirees as master limited partnerships, or MLPs, dropped 36% -- a shock since analysts previously claimed that pipelines and other infrastructure in MLPs would be immune to an energy crash. Another retiree favorite for dividends -- utility funds -- lost 9% in 2015, according to Morningstar.

"Bond funds weren't comforting either. The average bond fund investing in a broad mix declined about 2% … …junk bond funds have declined 4% on average, according to Morningstar."

We're only a few trading days into 2016 -- yet, so far, the new year isn't looking any more promising. Right now, you may be scrambling to make sense of the DJIA's huge tumble on Monday. (It was, in fact, the Dow's worst intraday start to the year since 1932 and worst full first day start since 2008.)

Ben S. Bernanke, former chairman of the U.S. Federal Reserve, is now open to the use of negative rates.

WASHINGTON (MarketWatch) — The Federal Reserve should consider using negative rates to counter the next serious downturn, said former chairman Ben Bernanke in an interview with MarketWatch.

“I think negative rates are something the Fed will and probably should consider if the situation arises,” Bernanke said in the interview last month.

Former Fed Vice Chairman Alan Blinder urged the Fed during the financial crisis to set negative interest rates for overnight deposits — essentially charging banks a fee to park funds at the central bank.

Blinder argued this would force banks to find more productive uses for the money.

Bernanke and his colleagues opted not to push interest rates below zero, worried that the costs outweighed the benefits.

Friday, January 29, 2016

The mining industry is collapsing. Everyone expanded dramatically because they never expected China to stop buying. The loading up of debt is likely to get many companies in trouble. We may see the entire industry downgraded on a wholesale basis. Those looking at the miner stocks should pay attention to the forecast on each one in Socrates. Some of the biggest will fall.

Wednesday, January 27, 2016

In the “Cycle of War” report, we mentioned in passing our models on plagues. We reported that this cycle nearly matched the war cycle coming in at 25.15 years. Unfortunately, this has turned up also in 2014. We warned that the Ebola virus was in a bullish trend and should reach a major event in 2019. Interestingly enough, the places with the least impact should be New Zealand and Scotland.

"Almost $3.2 trillion has been wiped off the value of stocks around the world since the start of 2016, according to calculations by a top market analyst. U.S. stocks are now off $1.77 trillion, while overseas stocks are down $1.4 trillion."

Stocks rallied on Thursday -- but then tanked even harder on Friday, which probably made that $3.2 trillion figure even bigger.

But how can that be? Doesn't money simply move from one asset class to another?

Our readers have asked us this question before -- especially during the 2007-2009 financial crisis, when 54% of the Dow's value got erased in just 18 months.

You may be wondering this, too. Well, here's an answer -- from Ch. 9 of Bob Prechter's New York Times Business bestseller, Conquer the Crash:

Wednesday, January 20, 2016

PARIS — French President Francois Hollande pledged Monday to redefine France’s business model and declared what he called “a state of economic and social emergency,” unveiling a 2-billion-euro ($2.2 billion) plan to revive hiring and catch up with a fast-moving world economy.